A Study of Uber Drivers 'Completely Explains the Gender Pay Gap'

The findings reveal three reasons why women earn less than men.

Employers may well be the source of the gender pay gap at some companies. At Uber, it could be the women themselves, according to a newly released study sponsored by the company.

Using data from more than 1.8 million drivers and over 740 million Uber trips from January 2015 to March 2017, five economists from Stanford, the University of Chicago and Uber say they have "completely explained the gender pay gap." Among other things, the first-of-its-kind study revealed that male drivers earn 7 percent more than women.

The question is, why?

At first blush, Uber's system would seem gender neutral. Drivers' earnings are calculated using a gender-blind algorithm, meaning a driver's gender is not factored in at all. Instead earnings are based on a formula that weighs rides' distance and time, and maybe a surge multiplier, when there is high demand.

If you guessed the pay gap is because riders prefer male drivers, you'd be wrong. In a blog post, the authors of the study write emphatically: "we find no evidence that outright discrimination, either by the app or by riders, is driving the gender earnings gap."

So instead of gender, the pay differential is attributed to three factors including: a driver's experience, where he or she chooses to drive, and how fast. In other words, women get less because they don't seize higher income producing opportunities--for instance, popular routes like airport pickups--and work fewer hours. Male drivers might earn more because they do more frequent pickups and drive a hair faster than women, for instance. Also, women tend to have higher turnover rates, which means they have less experience, further contributing to lower earnings.

Sound familiar? It echoes an old trope: women in the workplace earn less because they are not aggressive enough or they're not looking for more challenging work because maybe they have a family.

Indeed, it seems women in the gig economy are to blame for women not living up to their earning potential just as they are in the professional sphere. "The reasons we don't have total equality are not because of discrimination, or problems in how we compensate workers," Rebecca Diamond, another one of the study's authors and assistant professor of Economics at Stanford, told Freakonomics Radio. "It really is about working more hours and gaining knowledge on the job, and differences in gender preferences."

Of course, there's no mention among researchers that Uber's earnings formula might be tilted towards men or that the study offers zero explanation for why it maintains a higher turnover rate among women. If the company really wants to do something about its gender pay gap, these might be areas to inspect next.